SEPANG (June 22): AirAsia X Bhd (KL:AAX) plans to reduce airfares further as jet fuel prices return to normal levels, though the timing of these cuts remains unclear.

Fuel prices have already begun to ease following last week's memorandum of understanding between the US and Iran, which paved the way for formal peace talks. 

AAX group chief executive officer Bo Lingam expects the downward trend in fuel prices to continue, adding that the group had already lowered fares by 5% on June 15 and will implement further reductions as prices stabilise.

“We are reviewing it (fares) week by week. As fuel prices go down, we will also be revising our fares,” he said during a briefing on Monday.

When asked about his thoughts on a possible re-escalation in the conflict after US President Donald Trump’s recent threats as peace talks kicked off, Lingam said he could not comment.  

During the West Asia conflict, jet fuel prices peaked at US$240 per barrel and now hover around US$111 to US$112, and Lingam is “optimistic” for prices to come down further. 

Pre-war, it stood at US$85 to US$90.

With that surge in fuel prices, the group had hiked its fares by 30% to 40% in the last three months.

Several unprofitable routes were also dropped, while other cost optimisation efforts — via fleet efficiency and expense cuts — were also undertaken.

While the group has committed to bringing fares down, not all of its suspended routes will be reinstated, Lingam noted.  

“Whatever that we cut will be because it doesn’t make sense to operate it or it was already a non-profitable route before the war,” he said. Those that will be reinstated are targeted for end-August or early September, he added.

The West Asia conflict, and in particular its effects on global fuel prices, hit AAX hard in March.

Foreign exchange losses and higher fuel costs outweighed record revenue amid resilient passenger demand, dragging the group to a net loss of RM154.9 million for the first quarter ended March 31, 2026 (1QFY2026). The group had operated with no fuel hedge in place.

Deputy group CEO Ahmad Al Farouk Ahmad Kamal said the group will be implementing a rolling hedge on fuel based on its bookings over three-month periods.

He noted the hedge was already in the works with banks since January this year, but had to be put on hold due to the sudden West Asia conflict.

At the time of writing on Monday, shares of AAX stood unchanged at RM1.33, valuing the group at RM4.47 billion.